Auto insurance is a contract between you and the insurance company that protects you against financial loss in the event of an accident or theft. In exchange for your paying a premium, the insurance company agrees to pay your losses as outlined in your policy.
Auto insurance provides coverage for:
Bodily injury liability – which covers costs associated with injuries or death that you or another driver causes while driving your car.
Property damage liability – which reimburses others for damage that you or another driver operating your car causes to another vehicle or other property, such as a fence or a building.
Medical payments – Also known as personal injury protection (PIP), which provides reimbursement for medical expenses for injuries to you or your passengers.
Uninsured motorist coverage – reimburses you when an accident is caused by a driver who does not have auto insurance—or in the case of a hit-and-run.
Underinsured motorist coverage – which will cover costs when another driver lacks adequate coverage to pay the costs of a serious accident.
Collision – reimburses you for damage to your car that occurs as a result of a collision with another vehicle or other object—e.g., a tree or guardrail—when you’re at fault.
Comprehensive – provides coverage against theft and damage caused by an incident other than a collision, such as fire, flood, vandalism, hail, falling rocks or trees.
Glass Coverage – provides coverage from windshield damage.
Auto insurance coverages are priced individually to let you customize coverage amounts to suit your exact needs and budget.
Policies are generally issued for six-month or one-year time frames and are renewable. The insurance company sends a notice when it’s time to renew the policy and pay your premium.